Construction tops 30,000 homes; investment at record level

New Zealand is into its fifth straight year of strong growth in construction, with more than 30,000 homes consented in the year to October and record levels of commercial and infrastructure investment, Building and Housing Minister Dr Nick Smith says.

“Residential construction activity has reached $12.5 billion, an all-time high, and the number of homes consented has topped 30,000. This is the longest and strongest residential construction boom in New Zealand history, with five straight years of growth averaging over 20 per cent per annum. This is as fast as you can practically grow a sector as large and as complex as construction without compromising quality,” Dr Smith says.

“The 30,000 homes per year now being built is the fastest rate ever, with the exception of 2004 and the mid 1970s. The 2004 boom was focussed on thousands of small apartments in Auckland that are no longer allowed, and the 1974 boom rapidly crashed due to the unsustainable mix of high inflation and low interest government loans. The current boom is much more sustainable, better balanced nationwide and also involves record levels of investment in commercial and infrastructure construction.

“This ongoing strong growth shows the Government’s programme to increase housing supply is working. We have aggressively increased land supply with Special Housing Areas in the short-term, changes to Auckland’s planning in the medium term, and the National Policy Statement on Urban Development Capacity and Resource Management Act reforms in the long term.

“We have complemented this with the Crown Land Programme and a record level of direct Government projects to build homes, such as Hobsonville. We’ve also provided record levels of assistance for first-home buyers with the KiwiSaver HomeStart scheme, which has helped more than 20,000 people into their first home with about $500 million in KiwiSaver withdrawals for a deposit.

“Further reforms are in the pipeline to further grow the supply of housing. This Government is step by step, development by development, getting on and addressing New Zealand’s housing challenges.”